Studying the effect of cash flows’ management on firm performance in companies enlisted in Tehran Stock Exchange
DOI:
https://doi.org/10.24200/jmas.vol4iss03pp54-58Abstract
There is a common theory regarding cash flows management that deals with changing materials into cash resulted from goods and services sales. This is a reflection of firm’s ability to produce and is one of the fundamental concepts within financial literature. Methodology: Therefore, the present study has dealt with investigating about the effect of cash flows’ management on firm performance in companies enlisted in Tehran Stock Exchange. In this project 138 firms enlisted in Tehran Stock Exchange were studied during the time period between 2008 and 2012. To test the hypotheses we have used a pooled multiple linear regression model. Results: Research findings showed that on the whole cash flows’ management affects performance assessment criteria such as return on equity, return on assets, and Q Tobin ratio positively and meaningfully. Conclusion: Regarding the results of the present study it can be suggested to investors to consider the effects of cash flows’ management on firms’ performance when they are making decisions for investment. Since the goal of managers is to supply the trust of owners in a firm, they should consider that increasing cash flows’ management leads to increasing performance and this would be beneficial for an economic unit.References
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